Thomas Cook travel takeovers threaten competition: EU

7th January 2011, Comments 0 comments

European regulators warned on Friday that British holiday firm Thomas Cook's planned takeover of travel businesses of two independent retail groups would threaten competition in Britain.

The European Commission said its preliminary investigation found that competition could be significantly affected by Thomas Cook's acquisition of holiday units of the Co-operative Group and of Midlands Co-operative Society.

But the European Union's competition watchdog referred the case to British authorities because the two co-operatives -- which group retailers ranging from food stores to funeral services and travel agencies -- are not active outside Britain.

"The Commission's preliminary investigation confirmed that the proposed transaction would threaten to affect significantly competition in a distinct market which is at most UK-wide," it said.

The decision to send the case to London followed a request by Britain's Office of Fair Trading, which is concerned that the transaction could hit competition "in the distribution of holidays via retail travel agency outlets in the UK and a number of affected UK regions," the commission said.

Thomas Cook and the Co-operative Group announced in October a merger of their stores and foreign exchange businesses to create the nation's biggest high-street travel chain.

The new company would be 70-percent owned by Thomas Cook and 30-percent owned by the Co-operative, and would have more than 1,200 shops across Britain and about 4.3 million customers.

© 2011 AFP

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